Public Comment

Bates Housing Plan Fails to Address Berkeley’s Affordability Crisis

Rob Wrenn
Friday March 25, 2016 - 05:50:00 PM
The areas in pink are Priority Development Areas (PDAs) where "by right" zoning would prevail under a new proposal from Berkeley Mayor Tom Bates which will be discussed by the City Council on April 5. Residential areas immediately adjacent to these PDAs would be up-zoned to a distance of 200 feet or half a block.
The areas in pink are Priority Development Areas (PDAs) where "by right" zoning would prevail under a new proposal from Berkeley Mayor Tom Bates which will be discussed by the City Council on April 5. Residential areas immediately adjacent to these PDAs would be up-zoned to a distance of 200 feet or half a block.

Mayor Tom Bates has come up with a housing plan, with the dramatic heading “Addressing the Housing Emergency”, which unfortunately does little to address the city’s housing affordability crisis.

Most of its 13 recommendations would benefit for-profit developers of market rate housing, which is currently affordable only to people with incomes well above $100,000 a year.

It fails to advocate for a realistic funding plan that that would actually result in the creation of more affordable housing.

Among the problems with the plan are:

  • inadequate housing impact fees,
  • “by right” approval of housing in Priority Development Areas,
  • an increased density bonus benefiting only those earning 120% of area median income,
  • upzoning parts of neighborhoods near priority development areas,
  • possible reduction of fees paid by developers, and
  • accelerating conversion of rental units to condos.
His plan will be discussed by the City Council at its meeting on Tuesday, April 5. The agenda for that meeting with the mayor’s proposals can be found here.

What You Can Do

If you think the City should do more to fund affordable housing than what the mayor is proposing, I would encourage you to contact the City Council ( to express support for the Berkeley Progressive Alliance’s affordable housing funding proposals. You can find these proposals, part of their housing platform, on BPA’s Web site here.

You could also comment on the other aspects of the Mayor’s housing plan discussed in more detail below. There are many important issues being discussed by the City Council on April 5 and you could also come to the meeting and speak your mind.

The meeting starts at 7 p.m. and takes place at the Council’s new meeting location, the School District Board Room, 1231 Addison St. (Please enter at 1222 University Ave.) 



Housing Impact Fees 

The consultants hired by the City to do the Affordable Housing Nexus Study recommended a year ago that developers be required to pay a housing impact fee of $34,000 a unit. 

They found that the City could legally charge a fee as high as $84,000 a unit for rental developments. $34,000 was recommended as an amount that would insure that the project would still be financially feasible and give developers a reasonable return. The consultants estimated a return on cost of 13.9% for developers with a $34,000 fee. 

The City currently has a fee of $28,000, but Mayor Bates and his allies voted to discount the fee to $20,000 just as the proposed 2211 Harold Way high rise project downtown was being considered last year. 

Mayor Bates now wants to set the fee below the recommended $34,000. He would charge only $28,000 if developers pay the fee before they get their building permit. San Francisco already requires developers to pay their housing fees up front and their fees work out to be substantially more than $34,000 a unit. 

There is no reason why the city can’t both require payment of the fees before construction begins and charge $34,000. What Bates is proposing is a giveaway to developers that will cost the Housing Trust Fund millions over time, just as the City lost $1.8 million when he and his allies voted to discount the existing fee. 

Mayor Bates is also proposing that for developers who prefer not to pay the fee, 16.7% of total project units have to be affordable. This is an improvement over the current 9%, but the Nexus Study justifies setting the percentage at 20% as 100 units of market rate housing creates demand for about 25 units of below market housing. 

Other funding sources 

So what else is Mayor Bates proposing to fund affordable housing? The only other thing, recently added to his recommendations, is support for an Alameda County housing bond on November’s ballot. 

Berkeley’s recently release community housing survey, which can be found here, found that 61% of Berkeley voters would support a $500 million county affordable housing bond. 18% would oppose. So it has a good chance of passing here. 

Would it pass countywide given that it requires two-thirds to pass? It would probably require very large majorities in Berkeley and Oakland to compensate for probable less enthusiastic support in other parts of the county. But it would be great if such a bond passed and the mayor deserves credit for including it in his recommendations, even though success is far from certain. 

The Community Survey also found that Berkeley voters would support an increase in the business license tax paid by landlords. The idea is to capture some of the huge windfall in rental income that has occurred as rents have soared. 

60% would support an increase in the tax of $30 a month per unit on residential buildings with five or more units; 13% were undecided or said they didn’t know. 

Support jumped to 67% when survey respondents were told that the increase can’t be passed on to tenants and would bring in $4 million a year, enough to create 300 affordable units over ten years. 

Despite broad support for this funding source for affordable housing, Mayor Bates does not include it in his housing plan. And further he has no numerical targets for the Housing Trust Fund (HTF) or for the number of affordable units that the City should work to create. 

The Berkeley Progressive Alliance is calling for the City to commit to funding the creation of at least 100 affordable units a year and is calling for raising at least $10 million a year for the HTF. Their proposals include committing new revenue from taxing short term rentals (AirBnB, etc.) to the Housing Trust Fund. 

Mayor Bates has a record of voting down proposals to increase funds for the HTF. Council members Arreguin, Worthington and Anderson wanted to allocate $1 million in discretionary funds to the HTF in this year’s budget, but Bates and his allies approved the budget with no discretionary revenue ($164 million in 2016) going to the HTF. 

Recently, Mayor Bates and his allies voted down Councilmember Arreguin’s proposal to allocate 25% or any property transfer tax revenues above $10.5 million to the HTF. It should be noted that when the property transfer tax was increased from 1% to 1.5%, the additional money was supposed to go in large part for affordable housing. 

Mayor Bates even refused to support a proposal to loan $1 million to the HTF made by Councilmember Worthington. The HTF has only $3 million at present. 

Non-profit housing developers and land trusts told the City last year that they would need as much as $36 million to undertake all the projects they would like to undertake in Berkeley through 2018. 

Bates’ primary reliance on housing fees is problematic because that income is cyclical. When there is a housing construction slump in a recession, that income will dry up. The City needs some funding sources for affordable housing that aren’t tied to private housing development. 

By-Right Approval of Housing  

Mayor Bates is recommending “By-Right” approval of multi-family housing developments in “priority development areas” (PDAs) in Berkeley. He wants the Planning Commission to draft an ordinance. 

By-Right means that a project would be approved by a member of the planning staff with no involvement of the Zoning Adjustments Board (ZAB), no public hearings and no opportunity for public input or comment. The project would not require a use permit. 

Project development areas include the Downtown, the Southside (south of the UC campus), San Pablo Avenue, University Avenue, Shattuck south of Dwight Way, and the Adeline Corridor. [See map]. 

To qualify for by-right approval, a project would just have to meet certain criteria such as providing bike parking, spaces for car sharing, bus passes for residents, and meeting LEED Gold Green Building standards. 

And this interesting criterion: “minimum height equal to the maximum allowed under zoning for the property”. This suggests that if you proposed to build something at less than maximum allowed height, you would still need a use permit. 

With the possible exception of undefined “Local hire requirements for construction workers”, all of these criteria are things that are already routinely done and provide no exceptional benefit to the City. 

There would also be some design requirements that the Design Review Committee (DRC) is supposed to come up with, but by-right approval means there would be no DRC review of individual projects. 

This proposal would constitute a radical change to City zoning. More information about types of City permits can be found here

Berkeley is a built-out city with relatively little vacant land. Development invariably has impacts on adjacent properties and neighborhoods. There can be issues related to design, setbacks and solar access, traffic impacts, etc. 

The use permit process results in better projects as, not infrequently, modifications are made and conditions are attached to project approval as a result of public input and ZAB and DRC review. 

How well the use permit process works, of course, depends on the caliber of people appointed to the ZAB. Are they conscientious in evaluating projects or do they tend to just rubber-stamp staff recommendations? 

There is no evidence that the City’s long-standing use permit requirement is impeding housing development. It’s obvious to anyone that who travels around our city that we are in the midst of a market-rate housing boom. 

City Density Bonus 

The mayor proposes that staff and the Housing Advisory Commission draft a City Density Bonus ordinance that would reward developers by giving them an extra 15% of units on top of the current 35% bonus units that they get under the state of California’s density bonus law. 

Currently if a developer proposes to build 100 units, 11 of which are affordable to households with incomes up to 50% of the area median income, that developer gets the right to build 35 more units. 

What would developers have to do to qualify for Bates’ proposed extra 15%? They would have to add an unspecified number of units affordable to people at 120% of area median income or pay a fee for moderate income housing. 

For a family of four, 120% of median income in Alameda County is $112,200. In Berkeley, renter households have a median income of only $38,539 and 82% of renter households have incomes below $100,000. 

Giving a bonus that benefits people at 120% of median income is questionable. The City’s Affordable Housing Nexus Study concluded that “households earning 100 percent of AMI or less are typically unable to afford the average market rate unit in Berkeley.” 

When you get to 120%, rental housing becomes relatively affordable, though units in newly built market rate “luxury” developments remain beyond reach. 

Neighborhoods or Buffer Zones? 

In an amazing example of Orwellian newspeak, Mayor Bates tries to sell the idea of upzoning residential streets near PDAs as a solution to setback and shadowing issues created by development on commercial streets like Shattuck, University, etc. Stepping up of residential property is called stepping down. 

His plan is to have the Planning Commission draft an ordinance to upzone residential properties, that is, increase the allowable height and density, on blocks that include commercial property located in PDAs. 

What he is calling “buffer zones” would extend for one block or 200 feet in either direction from the primary commercial street. 

So, for instance, if you live on the north side of Addison Street, between MLK and Sacramento in a property currently zoned R-2, and that backs on to property that fronts on University, which is a PDA street, your property would be upzoned to R-3 which would allow reduced setbacks, higher density and taller buildings. 

Other streets that would presumably be affected, assuming a 200 foot limit, would include 10th Street, Kains, Byron and Wallace because of their proximity to San Pablo along with segments of streets that cross San Pablo. 

Near University, one side of Berkeley Way would be upzoned along with segments of cross streets. Near Telegraph zoning changes would apply to streets like Dana, Halcyon, Florence and Regent and also cross streets. 

Some R-1 zoned areas of Southwest Berkeley in Council District 2 would be affected. 

This won’t reduce shadowing and setback concerns. It will, on the contrary, exacerbate them. Taller buildings and the reduced setbacks between properties that come with upzoning mean greater impacts on access to sunlight and more potential for conflict. 

There is little vacant land in these proposed so-called “buffer zones”. Building to take advantage of increased height limits would certainly often involve demolition. Demolishing existing housing is always problematic. 

It’s possible that some owners of small rental properties might try to take advantage of the greater permitted density to demolish their buildings to build something larger. 

With a density bonus, especially if Bates’ proposed 50% bonus were adopted, this proposal could mean buildings up to 5 stories on these residential streets currently zoned R-1, R-2 or R-2A; buildings that would often shadow neighboring homes and make it harder for some people to get the benefits of putting solar panels on their roofs. 

Mayor Bates proposes to allow this density increase without calling for any quid pro quo. No requirements for affordable housing, solar panels or anything else that might be beneficial to the community. 

Reducing Developer Fees? 

There is also no quid pro quo suggested with mayor’s suggestion that City staff “examine” development fees on new construction. The implication is that maybe these fees are too high and should be reduced. 

There is certainly no evidence that these fees are so high as to discourage building of new housing. We are in the midst of a market rate housing boom in Berkeley. 

No consideration should be given to reducing fees unless the City gets something in return. For instance, a specified significant amount of on site alternative energy from solar systems, etc., or more affordable units on site. 

Rezoning the West Berkeley Senior Center 

The West Berkeley Senior Center, on Sixth Street at Hearst, has been closed since 2011, but is still in use by the City’s Aging Services Division. Mayor Bates proposes rezoning the site to allow a taller building to be built there. 

Current zoning allows 35’; his proposal would raise this to 50’. The idea is that the building could be “repurposed” for affordable housing and expansion of services. 

Building affordable housing there, perhaps wholly or in part targeted at seniors, would certainly be a good use for that site. Public land should be used for public benefit. Any housing built there should be affordable and no for-profit development should be included on public sites like this one. 

Promoting condo conversions? 

The last of the mayor’s thirteen recommendations calls for a Council appointed task force to look at condominium housing. Reading between the lines, it appears that the mayor doesn’t think there have been enough condo conversions; “only” 175 units have been converted since 2008. 

Converting rental units to condominiums reduces the supply of rental housing and does not contribute to increasing the supply of affordable housing. 

The mayor’s plan is silent on the one kind of conversion that would add to the stock of affordable ownership housing, namely the creation of coop housing through land trust acquisition of existing rental property. Land Trusts would, of course, need some support from the City’s Housing Trust Fund which the mayor’s plan fails to adequately fund. 

Fee Waivers for Section 8 Rentals 

This is one of the few good recommendations in the Bates housing plan. It would make it easier for those fortunate enough to have a Section 8 voucher to find housing in Berkeley. 

The idea is that landlords who rent to Section 8 tenants would have fees that they would normally pay to the City or Rent Board waived. With rents soaring, the payments that the Berkeley Housing Authority will pay to landlords who take Section 8 tenants have fallen too far short of market rates. 

The recommendation asks the City staff and Rent Board to look at waiving fees. 

Undoing the Southside Plan 

Mayor Bates also wants to upzone the areas of Southside closest to Dwight Way, its southern boundary. He wants it returned to R-4 zoning, which allows buildings of up to six stories, or 8 with a density bonus, or 9 with his proposed City Density Bonus. 

From a planning standpoint, this makes absolutely no sense. The Southside Plan embraced the idea of stepping down development as you move from the campus to Dwight. Density was increased in areas closest to campus, while lower heights were permitted in areas closer to established residential neighborhoods. 

R-4 is outmoded zoning and it doesn’t allow greater density than R-S zoning, it just allows greater height but with more restrictive lot coverage standards. Under the Bates plan, buildings on Dwight Way could be taller than buildings closer to campus. How does this make sense? 




Rob Wrenn is a former member and chair of Berkeley’s Planning Commission. He helped write the Berkeley Progressive Alliance’s affordable housing platform.